US Stocks rise on robust earnings and shrug off Commerce Sec Ross’s comments

US stocks trade higher, albeit in a choppy manner in early trade after a brief selloff stemmed from an overreaction to Commerce Wilbur Ross comments on CNBC on trade talks.  The move higher in equities was supported by a wrath of earnings painting differing stories among the 11 sectors.  The US equity market initially sold off before the open after Commerce Secretary Ross’s comment that the US is “miles and miles away” from a China trade agreement.  The markets however paid little attention to his optimism that he thinks there is a fair chance a deal will get done, just not this week.  The rest of the comments which emphasized the need for progress on intellectual property theft and structural reform are in line with his prior comments over the past month.  Sentiment is poor and the markets are overreacting to dire comments on trade talks.  The dollar is also modestly stronger against its major trading partners.

Earning results this morning where strong from the airlines and not so bad for technology companies.  Consumer discretionary stocks were flying higher after robust results from American Airlines, Southwest, and Jet Blue, although the uncertainty from the partial government could weigh on results in Q1.  The pummeled technology sector is showing the strongest gains today as results and the outlook from STMicro are helping some believe that semis could be poised to see a bounce in the second half of the year.  After the close we will see earnings from Western Digital, Intel and Starbucks, all showed signs of challenges last year and the bar is low for them to surprise.

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Ed Moya

Ed Moya

Senior Market Analyst at OANDA
With more than 20 years’ trading experience, Ed Moya is a market analyst with OANDA, producing up-to-the-minute fundamental analysis of geo-political events and monetary policies in the US, Europe, the Middle East and North Africa. Over the course of his career, he has worked with some of the world’s leading forex brokerages and research departments including Global Forex Trading, FX Solutions and Trading Advantage. Most recently he worked with TradeTheNews.com, where he provided market analysis on economic data and corporate news. Based in New York, Ed is a regular guest on several major financial television networks including BNN, CNBC, Fox Business, and Bloomberg. He is often quoted in leading print and online publications such as the Wall Street Journal and the Washington Post. He holds a BA in Economics from Rutgers University. Follow Ed on Twitter @edjmoya ‏
Ed Moya